ACCESS TO CAPITAL
Financial Service Institutions and Services
Small businesses mean jobs and stability for a community. When we think about what a small business needs, the first thing that comes to mind is money. Whether it’s money to start a business or to keep it running, small businesses need capital to stay in business. But in Baltimore, minority-owned businesses are often unfairly denied loans, making it harder for them to keep their doors open. Fortunately, there are Community Development Finance Institutions as an alternative to traditional bank financing, which
Before you pick a lender, ask yourself this: Which two matter most to me: Saving Money, Accessibility, or Consistency?
COMMUNITY DEVELOPMENT PRODUCTS OFFERED
SAVING MONEY & ACCESSIBILITY
If you chose saving money and accessibility, you might want to consider a Community Loan Fund (“CLF”). Because CLFs are not banks or credit unions, they are less regulated and free to develop innovative financial products to meet the needs of a given business community. This can translate to better rates for borrowers. Plus, a number of them are getting Federal funding for their work in Baltimore City.
Enterprise Community Loan Fund: Small Business, Commercial Real Estate
Maryland Capital Enterprises: Business: Microloans
Neighborhood Housing Services of Baltimore: Consumer Finance Housing
Urban Action Community Development LLC: Community Facilities
Baltimore Community Lending: Housing to Organizations, Commercial Real Estate, Community Facilities
Healthy Neighborhoods: Housing to Organizations, Consumer Finance
Latino Economic Development Center: Business: Microloans
The Reinvestment Fund: Housing to Organizations, Commercial Real Estate, Community Facilities
SAVING MONEY & CONSISTENCY
If you chose saving money and consistency, consider a Community Development Credit Union (“CDCU”). Credit unions are organized with the primary purpose to help members get loans and save money. They are not-for-profit, so they can charge less on the loans they offer. And they are heavily regulated, which means you can expect consistency in the types of loan products they offer and the security of the money they lend.
ACCESSIBILITY & CONSISTENCY
If you chose accessibility and consistency, a Community Bank might be where to start. Community Banks are generally accessible, with online services and no membership or geographical requirements. They are for-profit, which means they will compete to maintain their market share. Supported by agencies like the FDIC, they are also heavily regulated, with substantial requirements for making sure that the money they lend goes to the communities that need it. Community Banks are also regulated to offer consistent, fair loan products.
There is one Community Bank in Baltimore City that received Federal funds for its community lending in the past five years.